
Identify the company from five clues: high ROE despite low asset turnover, stagnant revenue, a separated cousin building a global business, cyclical returns, and high founder ownership.
Here is a challenge. Using the five clues below, identify the company being described.
I belong to an industry notorious for asset turnover of around 1x, yet I still earn 15-20 per cent return on equity.
Despite spending 20 per cent of my profits on brand building every year, I am struggling to grow, as evidenced by a 5 per cent CAGR in annual revenue over the last decade.
My cousins, who separated from my founder family, have gone on to build a multi-billion-dollar global business and delivered 50x returns to shareholders over the last 15 years.
While I have delivered 5x returns to shareholders in three years twice in previous business cycles, cumulative return is only 12 per cent per annum over the last 10 years.
My founders continue to own more than two-thirds of the company, and institutional ownership is negligible.
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